No matter what advertisers think of online advertising, it is the way of the future.
The debate on whether advertisers are keen to utilise the online platform will be very short-lived. This is because the answer is clearly visible in the growth in South African digital advertising during the last decade.
Online ad spend in developed countries like the United States and United Kingdom plays second fiddle to television revenue, but one feels that it is only a matter of time before this gap is eroded. After all, digital and internet-provided television (IPTV) are just around the corner.
The question that should be asked is whether or not sufficient value is being put into online advertising in South Africa. Gone are the days when advertisers allocated their ‘left over’ budget to online. Major brands are now ensuring that around 20% of their budgets are allocated to the digital world.
Are advertisers keen to advertise online? The answer is sadly both yes and no. Often there is a significant misunderstanding of this medium and its associated terminology – clicks, frequency, impressions, CPM (cost per thousand), CPC (cost per click), IP (internet provider) targeting and to a certain extent even the term ‘online’.
There is also a lack of appreciation of the fact that there are multiple media within the medium, and there are a variety of backend systems needed.
But does this stop them? No.
Advertisers are starting to recognise the value that online media can yield – whether it’s engagements, return on investment, leads, branding or research and insights. Online is the only real-time medium that can measure results instantly, right down to ticket sales and revenue generated.
In order to make sure this online bug stays healthy, a key approach we as media specialists must take is to educate clients/advertisers continuously about the medium and how it works – but more importantly, why it works for them specifically.
We are seeing massive interest regarding social media sites like Facebook, Twitter, LinkedIn and, to an extent, Pinterest. This has to be carefully managed, as it is not your typical online advertising medium and, more often than not, brand pages are not equipped to manage this space.
These platforms provide a space to engage and concentrate on the ‘why we love you as a consumer’ communication by listening and reverting to their complaints or compliments and praise. It’s not a platform for ‘push’ advertising. Correctly implemented, social media can strongly influence brand loyalty, equity and credibility among the expressive consumer.
Online advertising (while still poorly measured) has seen small revenue increases year on year, but budgets are starting to increase as the need for online presence is continuously sought. And one can’t help but feel online media is a time bomb waiting to explode. Clients who are most likely to advertise online are usually globally positioned blue chip clients.
An increase in internet affordability, connectivity and greater speed will assist the online explosion. As the data wars continue between the multiple providers, online audiences will continue to grow. Currently online has a penetration rate of roughly 13% of the South African population, with approximately 11 million unique users.
Top global leading websites have already recognised South Africa as a brewing online audience. As a result, sites like MSN and Yahoo! have realigned domains and content so that they’re more suited to the South African audience.
It’s an exciting platform in which to play and work, and it’s only going to get better as advertisers engage with and understand the platform and its possibilities in ever more creative and productive ways. n
Gordon Patterson is the chairman of VivaKi SA and group MD of the Starcom MediaVest Group (SMG).
This story was first published in the February 2013 issue of The Media magazine.